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A company had EBIT of Rs.3,70,000. The interest expense was Rs.45,000. The tax rate is 30%. The company paid Rs.31,000 dividend. What is the retention ratio of the firm?

Q: Answer-A company had EBIT of Rs.3,70,000. The interest expense was Rs.45,000. The tax rate is 30%. The comp...

Retention ratio net profit dividend net profit Retention ratio EBIT interest tax dividend net profit Retention ratio 370000 45000 97,500 31,000 2,27,500 Retention ratio 86.37

A 79%

B 84%

C 86%

D 64%

E 68%

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A company had EBIT of Rs.3,70,000. The interest expense was Rs.45,000. The tax rate is 30%. The company paid Rs.31,000 dividend. What is the retention ratio of the firm?

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